Jan. 13 (Bloomberg) -- Arizona Governor Jan Brewer will
allow medical marijuana dispensaries to open following the
dismissal of her federal lawsuit over the 2010 state law
authorizing their creation.

Brewer said today she wouldn’t continue to pursue the court
case, which sought assurance that the state could carry out the
voter-approved law without subjecting state workers to federal
charges. U.S. District Judge Susan Bolton dismissed the case on
Jan. 5, saying there was no threat of “imminent prosecution.”
Bolton gave the governor 30 days to amend and refile.

The governor will direct the state’s health department to
begin accepting and processing applications from those seeking
to run marijuana dispensaries once a separate legal challenge
over state rules is resolved, she said in an e-mailed statement.
The venues are capped at 125 statewide under the law.

“It is well-known that I did not support passage of
Proposition 203, and I remain concerned about potential abuses
of the law,” Brewer, a 67-year-old Republican, said in the
statement. “But the state’s legal challenge was based on my
legitimate concern that state employees may find themselves at
risk of federal prosecution for their role in administering
dispensary licenses under this law.”

Assurance Sought

Brewer said she will still seek assurance from federal
prosecutors that state employees won’t be charged under U.S.
laws, which ban marijuana even for medical purposes.

“I won’t hesitate to halt state involvement in the AMMA if
I receive indication that state employees face prosecution due
to their duties in administering this law,” she said, referring
to the Arizona Medical Marijuana Act.

Arizona and 15 other states have legalized the use of
marijuana for medical purposes. Approved in November 2010 by a
margin of fewer than 5,000 votes, the Arizona measure created a
system of non-profit dispensaries to be regulated by the state
health department. Patients are barred from growing their own
marijuana if they live within 25 miles of a dispensary.

Brewer filed her lawsuit five days before the state was set
to begin accepting applications from would-be dispensary
operators in May. The move opened the door for patients and
caregivers to grow their own marijuana. Since then, the state
has approved 18,000 medical marijuana patients, of which 15,000
are allowed to grow their own pot, according to the Health
Services Department website.

A pending lawsuit in state court filed by attorneys for
Compassion First, a group formed to assist those seeking to open
dispensaries, has challenged the health department’s rules that
restrict who can run a marijuana facility, according to Ty
Taber, an attorney in Phoenix at Aiken Schenk.

Those rules include state residency requirements, a
prohibition against those with prior bankruptcies and other
limits not included in the law voters approved, Taber said.

Taber said he would discuss Brewer’s announcement with his
clients to evaluate whether to continue to pursue the case if it
will delay the opening of dispensaries.